Friday, 11 August 2017

EASE OF DOING BUSINESS IN NIGERIA – REGULATORY AND COMPLIANCE REQUIREMENTS

The position of Nigeria in terms of the ease of doing business is not too good going by the World Bank report on Ease of Doing Business index released early this year. Nigeria presently ranks 169 out of the 190 countries of the world assessed. Although it is an improvement over the ranking of 170 in 2015 and 175 in 2014. Between 2008 and 2015, our average ranking has been 141. In 2008, Nigeria ranked 108 which was the highest ranking we have got so far and the lowest in 2015, 175.


Going by the World Bank index on the ease of doing business, there are eleven indicators listed thus:

(i)     Ease of registering a business                               138th
(ii)    Simplifying the mode of paying taxes                     182nd
(iii)   Enforcing contracts                                               139th
(iv)   Registering properly                                              182nd
(v)    Access to Electricity                                              180th
(vi)   Dealing with construction permits                         174th
(vii)  Getting credit                                                        44th
(viii) Labour market regulation                       
(ix)   Protecting minority investors                                 32nd
(x)    Trading across Borders                                         181st
(xi)   Resolving insolvency                                             140th

At present 137 economies around the world have adopted key reforms that make it easier to start and operate small and medium-sized businesses.

The most improvement for Nigeria is in the area of access to credit as the Country moved up to 16th position from 44th.

Requirements to incorporate a Company

Ø    At least 2 Directors
Ø    A Company Secretary
Ø    At least two subscribers who can also be the Directors
Ø    Secure a name for the Company
Ø    Obtain incorporate form, fill and sign it.
Ø    Pay the appropriate stamp duty thereon
Ø    Pay the CAC assessment fee
Ø    Submit and pick the Certificate of Incorporation
     
   List of Government Agencies

Ø FIRS
Ø SBIR
Ø Trademark Office
Ø NIPC
Ø NCC
Ø NAICOM
Ø CBN

Taxes Payable by Companies

Ø Education Tax                                     2% of taxable profit
Ø Company Income Tax                          30% of taxable profit
Ø Pension Contribution for staff             10% of gross salaries
Ø Employee Compensation Fund             1% of gross salaries
Ø ITF                                                     1% of gross salaries
Ø Capital Gain Tax (if any)                      10% of capital gain
Ø Land Use Charge                                0.132% of property value
Ø Stamp duty on cheques                       5/1000 of value of cheque
Ø Road license                                       N5000 per value
Ø Value Added Tax                                  5%
       
 A newly registered Company is expected to apply for and obtain a Tax Clearance Certificate.

FOR MORE INFO:
Visit our website at http://www.ez37solutions.org/ez37/

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